Sometimes we think we have a strategy when we don’t. Here’s a list of five simple questions you can ask yourself to test whether or not you’ve got a strategy that is working.
- How does you strategy guide your choices in today’s chaotic marketplace?
Great strategies direct our choices and decisions. If you find yourself flummoxed by the machinations of your marketplace, then it’s likely your strategy isn’t supporting your decision-making. It’s silent on something you need it to speak about. If you don’t know what to do right now, you don’t have a strategy!
- Does your strategy clearly answer the questions of who, what, and how?
The who — which groups of customers will you target? The what — which offerings (products or services) you will deliver to your target customers? And the how — which methods of marketing, sales, and distribution will you use to deliver your offerings to your customers? The key is to focus on the best combination of the who, what, and how.
- What metrics do you use to track whether your strategy is working?
Trailing indicators of performance, like sales and profit, aren’t particularly helpful in tracking your strategy. It can take months to see how a strategy influences sales and profit and then only dimly. To track strategy, use leading indicators that help you visualize how well your actions match your strategy. Every element of your strategy should have a metric to help you track it. Examples of leading indicators include weekly measurements of new qualified “target” prospects and dollars spent on development of “target” products versus other products. These leading indicators help build a connection between our strategic action and the outcomes we hope to achieve.
- How aligned and engaged is your team in your strategy?
Most strategies are developed by the select few. It may seem faster and better that way, but the downside is that research shows that people are less aligned and engaged when they feel they aren’t listened to and when they don’t see how their work is influenced by the strategy. In addition, a strategy built just by executives or outsiders may be blind to dynamics that people on the front line see every day. If it feels like you’re herding cats, it may be time to bring the cats into the planning process.
- What does your strategy tell you to stop doing?
We all waste time and energy on things that divert us from focusing on those activities that lead most directly to the outcomes we want. The most effective strategies are specific about what we will STOP doing. They identify the 20% of our efforts that generate 80% of our results and then help us put 80% of our effort there by stopping those things that make little difference.
If you find your answers to these questions coming up short, start by creating compelling alternatives to each of these questions with your team. You’ll be amazed at what can happen!